PALO ALTO, Calif. (AP) — After its CEO warned of another tough quarter, Hewlett-Packard Co. cut its full-year outlook Tuesday citing to soft PC sales and the effects of the earthquake in Japan.
HP said its net income for the latest quarter rose slightly, but investors focused on challenges ahead sent shares down 5 percent before the market opened Tuesday.
The world's largest technology company by revenue reported earnings of $2.3 billion, or $1.05 per share, for the three months that ended April 30. That's up from $2.2 billion, or 91 cents per share, in the same time last year.
Excluding special items, HP earned $1.24 per share in the latest quarter, ahead of the $1.21 per share that analysts polled by FactSet were expecting.
Revenue climbed 3 percent to $31.63 billion, slightly above Wall Street expectations of $31.55 billion.
For the full year, HP now expects adjusted earnings of $5 per share, down from its earlier outlook of $5.20 to $5.28 per share. Analysts had been looking for $5.24 per share.
The company reported its quarterly results a day early after a leaked memo from CEO Leo Apotheker warned that the company was bracing for "another tough quarter" in the May-July period, and that management needed to "watch every penny and minimize all hiring."
In addition to the earthquake and weak consumer PC sales, HP warned of falling operating profits from technical services.
HP, the world's No. 1 PC maker, is wrestling with poor demand from consumers even as business spending has begun to recover.
Shares of the Palo Alto, Calif., company fell $2.07, or 5.2 percent, to $37.73 in premarket trading.